Ford to end production of all cars save Mustang, Focus

Ford will deepen planned cost cuts and phase out several small models in North America even as it reported better-than-expected quarterly earnings, the company announced Wednesday.

Nearly 90 percent of the Ford portfolio in North America will be trucks, utilities and commercial vehicles.

The company's stock was up 2.6 per cent at US$11.40 in after-hours trading.

That means the company will no longer sell the Fusion midsize vehicle, Taurus large auto, Focus compact and Fiesta subcompact in the region as the market continues a dramatic shift toward trucks and SUVs.

The automaker says over the next few years, the Ford auto portfolio will transition to two vehicles: the best-selling Mustang and the all-new Focus Active crossover coming out next year.

The most notable underperforming part of Ford's business in the United States is without a doubt its sedans, which is why the company had previously announced plans to make 90% of its North American portfolio trucks, SUVs and crossovers, and commercial vehicles within the next two years.

Chief Financial Officer Bob Shanks said the company will cut $5 billion from capital spending from 2019 to 2022, reducing it from $34 billion to $29 billion.

Consumers have made a decisive shift away from four-doors to SUVs in recently years. Analysts had on average expected earnings per share of 41 USA cents. That is slightly higher than the first quarter of past year, when Ford earned $1.59 billion, or 40 cents a share.

In the first quarter of 2018, Ford's profit margin dipped to 5.2pc from 6.4pc a year earlier, as it was squeezed by higher aluminium and steel prices.

One third of Ford's efficiencies will come by the end of 2020, Shanks said told reporters. Europe was the only other region to turn a profit for Ford. That includes a 10 percent pretax margin in North America.

The company's loss in its Asia Pacific region was driven by slumping sales in China, where Ford has just begun to introduce new models.

Joe Hinrichs, president of global operations, said Ford plans to build a new product its Hermosillo plant in Mexico when it quits production of the Fusion sedan, and will also build a new battery electric vehicle in Mexico.